Charles Schwab, a pioneer of the discount brokerage, is stepping down as chief executive of the company that bears his name.
Schwab, 70, will remain executive chairman of Charles Schwab Corp, the company he launched in 1973, and will be replaced as CEO by Walter Bettinger, effective October 1, the company said on Tuesday.
Bettinger has been chief operating officer at the company — which has a market cap of more than $26 billion — since February 2007.
Schwab said in a statement: “I will continue to serve as a very active chairman and look forward to continuing the strong partnership that Walt and I have developed.”
Schwab headed the firm until 1998. He then became co-CEO with David Pottruck during the boom and bust of the dot-com era.
Pottruck was CEO for about a year before Schwab returned to re-inject confidence in the brokerage, which was seen as straying from the business model its founder had established.
A spokesman said the company had planned for a successor since 2004. “The company is doing very well and the strategy is moving forward, so it seemed to the board and to Chuck that it was the right time,” said Schwab’s Greg Gable.
Charles Schwab was not available to comment.
“This is the guy that led the change in the business model,” said Adam Honore, senior analyst at Aite Group.
Rivals have been scrambling to mirror that model, which relies heavily on the accumulation of clients’ assets.
“Given everything else that’s going on, the Street may hit Schwab a little bit because the brand name is leaving, but when you look under the covers it’s not that big a deal,” Honore said.
“It’s the picture of stability as far as transitions go.”
The company’s shares, which closed up 4.5 percent at $22.85 on Tuesday, have managed to duck much of the damage the credit crunch has brought on the rest of the financial sector.
Separately, the company said it would increase its quarterly cash dividend, payable in August, by 20 percent to 6 cents a share.
